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More than a decade after selling their first payroll start-up to local tech giant Xero, Karbon co-founders Stuart McLeod and John Freeman have scored $US66 million ($93 million) for their accounting practice management software company from one of the world’s best investors in industry-specific software businesses.

The renowned investor behind Tidemark Capital, former Technology Crossover Ventures (TCV) veteran David Yuan, got in touch with Karbon late last year. Despite not actively looking for more capital, the Aussie founders said they felt compelled to engage.

The funding from Tidemark came with a $US285 million ($402 million) post-money valuation, which represents a 5.7 times jump in 11 months since Karbon raised $US10 million in a round led by Five Elms, which valued it at $US50 million.

“When Dave reached out we stood up and took notice because he’s one of the premier investors in vertical SaaS [software as a service],” Mr McLeod told The Australian Financial Review.

“He is world-class, is extremely intelligent, has an amazing team he’s built at Tidemark, and has the history and capacity to invest in portfolio companies like Toast, Siteminder and Xero even.”

While at TCV, Mr Yuan was also involved in investments in a rollcall of tech success stories, including TikTok’s parent company ByteDance, Facebook, Splunk and LinkedIn.

Cloud-based company Karbon, which is headquartered in the US but has about half of its workforce (including co-founder Mr Freeman) in Australia, provides software for small and medium-sized accounting firms to run their practices, including client and project management tools, performance analytics and workflow automation.

It has 2500 accounting firms signed up in 20 countries and is increasing its revenue by about 100 per cent year-on-year. Based on LinkedIn data, there are between 160,000 and 170,000 accounting firms globally, giving Karbon a little over 1 per cent of the market.

Depressing days

Mr McLeod said the latest raise was a contrast to its earlier rounds, where investors were less enthusiastic.

“In the series A round, we did 65 or 66 meetings. We had some very depressing and disheartening days up and down Sand Hill Road [in Silicon Valley] and [the investors] were probably right, we weren’t ready,” he said.

“We didn’t have a massively expanding market, or the growth figures they expected. It was a hard lesson, but one that we took as an opportunity to really work hard, persevere, and be resilient and ... now, two years into COVID-19, everyone is looking for progressive and well-thought-through software like ours that give accountants an edge.”

Mr McLeod and Mr Freeman started Karbon in 2014, three years after selling their previous company, Paycycle, to Xero for $1.5 million.

While Xero and MYOB have practice management software, Karbon’s largest rivals are legacy desktop-based incumbents from companies including CCH and Thomson Reuters.

Push into larger firms

Mr Mcleod said Karbon was focused on building more features into its platform, including time-based billing, invoicing, accounts receivable integration and, ultimately, payments.

It is doubling its client base every year, and he said the next big milestone would be to hit 10,000 accounting firms on the platform.

As part of this plan, the company is pushing into larger firms, and is looking to hire an additional 170 people this year.

“We want to push up market and service some larger firms,” he said.

“We also want to hit $100 million in revenue in the next five to six years. We’re on target for that, and that’s what we’re aiming for.”

Karbon’s raise is the latest in a series of big rounds announced already in 2022. Last week, Cyara banked more than $US350 million from K1 Investment Management. In January, Milkrun scored $75 million from Tiger Global Management, Dovetail raised $89 million at a $960 million valuation, and Sydney-based digital health start-up Eucalyptus locked in $60 million in a round led by Mary Meeker’s Bond Capital.

Mr Yuan said Karbon was exactly what he looked for in a vertical SaaS company.

“[It’s] a clear category leader and a magical user experience that empowers modern accountants to serve their clients better,” he said.

“Accountants are rapidly shifting to digital as the key trust advisers to SMB. We’re excited to support Stuart and the Karbon team build the next great vertical platform to drive this industry transformation.”

Amazon.com is more than doubling the maximum base salary it pays employees to $US350,000 ($491,370) from $US160,000 ($224,620).

“This past year has seen a particularly competitive labour market, and in doing a thorough analysis of various options, weighing the economics of our business and the need to remain competitive for attracting and retaining top talent, we decided to make meaningfully bigger increases to our compensation levels than we do in a typical year,” the company told employees on Monday US time in a memo reviewed by Bloomberg.

Amazon also said it was increasing the compensation ranges of most jobs globally and was changing the timing of stock awards to align with promotions.

Like many big employers, Amazon has struggled to hire and keep workers of late. The company has long relied on stock awards, betting it can entice workers to take positions even if the base pay is low. But the stock languished in 2021, gaining just 2.4 per cent while the S&P 500 jumped 27 per cent, and the strategy began to lose its appeal.

Media reports indicate the turnover rate inside Amazon has reached crisis levels, and a record 50 vice presidents departed last year.

Amazon’s salary rise was reported earlier by Insider.

The e-commerce giant employed 1.6 million globally as of December 31, including warehouse workers who are paid hourly and office staff who earn annual salaries. Amazon declined to say how many employees would receive the bump in pay announced on Monday.

Amazon pays warehouse workers at least $US15 an hour and in September said it had raised average wages for these employees to $US18 an hour. During the pandemic, the company has spent heavily on its logistics operation, hiring hundreds of thousands of people and paying bonuses to new recruits.

Investors have been warily watching Amazon’s rising costs and expressed relief when the company reported a strong fourth quarter last week and said an annual Prime subscription would rise $US20 to $US139.

The shares soared almost 14 per cent on Friday and were up a further 1 per cent to $US3174.47 at 1.35pm on Monday in New York.

• Building the tech skills of Australian workers could recoup some of the GDP lost through the pandemic.
• Those are the findings of a new report from RMIT Online and Deloitte Access Economics.
• Tech skills are “worth a lot more than how much we’re investing in training,” said Deloitte partner John O’Mahony.

A new report claims Australia lost out on nearly $150 billion in economic growth through the COVID-19 pandemic —but providing workers with digital skills could help erase that significant productivity deficit.

In a fresh report detailing Australia’s skills shortage and how the coronavirus crisis has reshaped the jobs market, RMIT Online and Deloitte Access Economics suggest the Australian economy produced some $148 billion less in GDP than it would have in a pandemic-free world.

The nation’s closed border policy had an outsized impact on its own, carving away $32 billion from the GDP Australia would have amassed otherwise, the report says.

The report does not just count the cost of COVID-19 — it suggests that without a change of course, Australia’s economy will be permanently smaller as a result of the coronavirus productivity divot.

“This means that reverting to pre-pandemic trends isn’t enough,” the authors state. “Instead, even stronger growth is needed to correct for losses incurred during the pandemic.”

Training in digital skills a necessity for growth

The report’s authors suggest re-skilling Australian employees is a viable way to make up for lost time.

John O’Mahony, partner at Deloitte Access Economics, said the research showed businesses, governments and individuals have an “extra responsibility” to “think smarter about how we can drive more growth inside workplaces”.

While ceding the report was prepared in conjunction with RMIT Online, which provides tech courses to workers looking to boost their skill set, O’Mahony said “businesses need to be investing more in re-skilling, and employees need to be putting their hand up and saying, ‘I want to be training more'”.

“And the evidence for the last two years is that while we’ve had more time in our hands during COVID, we haven’t used a lot of spare time to do more to do more training.”

Employers spend just two days a year actively bolstering the skills of their employees, O’Mahony said, meaning some workers are being left behind as digital skills infiltrate every aspect of working life.

Those skills are “worth a lot more than how much we’re investing in training,” he said.

“The research here finds that on average, picking up digital skills lift a worker’s productivity, lifts their wages, by around 9% a year.

“So if you think the return on getting these digital skills is 9% a year, it’s about $7,500 in wages.”

Combining new skills with old-fashioned migration

The report’s findings speak to the concerns of employers, who say a shortage of tech-centric skills have driven some wages into the stratosphere and constrained productivity.

While re-skilling workers with tech know-how will ease those concerns, the authors also acknowledge the role skilled migration could have in bolstering Australia’s productivity.

Policies which effectively brought international migration to a standstill mean Australia’s population is nearly 380,000 below where it would be without border closures, the report says.

In sharper terms, Australia missed out on more than 21 million hours of potential labour in September 2021 than it would have otherwise, the authors argue.

Of more than 400 business leaders surveyed for the report, more than half said it became more difficult to attract new staff through 2021.

And of the employers who said hiring the right staff was difficult, 27% said border closures had restricted access to talent — narrowly more than any other reason listed.

“For Australia to achieve its full economic potential, it will also need to reopen borders and get the most out of top international talent to help fill the skills gap,” O’Mahony said. “So it will also need to do that as well eventually.”

Prime Minister Scott Morrison yesterday revealed Australia’s hard border policies will come to an end on February 21, ushering in new waves of skilled migrants previously locked out of the country and easing some of those talent bottlenecks.

However, The Australian Financial Review reports there is little appetite in Canberra to lift the cap on net international migration from 160,000 a year.

Regardless of immigration policy tweaks, if they arrive at all, the RMIT Online and Deloitte report argues employers ought to take it on themselves to maximise the talent available today.

“Simply reopening [Australia’s] borders is not going to replenish the number of migrants who did not come to Australia over the past two years, making upskilling our existing workforce critical,” the report states.

Australian businesses will find it easier to import Indian information technology professionals to ease severe skills shortages in the sector under the free trade agreement being negotiated by Canberra and New Delhi.

Australian and Indian negotiators will exchange their respective offers to reduce trade barriers on goods on Friday, after swapping proposals on services last week.

Trade Minister Dan Tehan said finalising the Comprehensive Economic Co-operation Agreement was his top priority, and he was holding weekly talks with Indian counterpart Piyush Goyal in a bid to finalise the deal by the end of the year.

With the shift to working and learning at home brought about by the pandemic, Australia is already grappling with a shortage of IT professionals. The Tech Council estimates that by 2025, that gap will grow to 260,000 workers.

Mr Tehan said India, a tech sector powerhouse, could help fill the void, with the final free trade deal to help Australian firms “get access to the best human IT capabilities”.

“This will be a key part of the agreement,” he said.

“India also has a strong interest in their international students and around the area of post-study work rights, so that’s another area we are looking at.”

‘Tough’ negotiations

As with all FTAs, Mr Tehan conceded agriculture remained a stumbling block.

“The negotiations are tough as you would expect. There are sensitivities on both sides. We’re very determined not to see them get in the way,” he said.

“Obviously wheat, beef and dairy are very sensitive for India. We’re very committed to explore from an Australian perspective other opportunities in India.

“There are other opportunities for us in legumes, grains, sheep meat, wine.”

Tech Council chief executive Kate Pounder said skilled migration would only ever be a supplement to the local workforce, which would require 1 million people in tech jobs by 2025.

“Skilled migration is an important component of tech workforces globally,” she said.

“Accessing skilled migrants is especially important for Australia because our industry is still relatively young and smaller than some other markets.

“Australia obviously also trains a lot of Indian students, so we already have close ties via our education system in tech. However, more than 50 per cent of international students leave Australia within two years of completing their degree. There is an opportunity to build more permanent relationships between people working and studying between the two countries.”

Meanwhile, Defence Minister Peter Dutton said he hoped China’s new ambassador to Australia, Xiao Qian, was “sincere” in wanting to improve bilateral relations, but the Morrison government would not shy away from raising human rights abuses and other issues.

“We want a good, strong friendly relationship with China but at the moment China is in conflict,” Mr Dutton told 2GB.

“Not just with us where they’re cutting off markets and the cyberattacks that are going on, but with the Philippines, they’re at loggerheads with the Indians, the Vietnamese, with many, many other countries – and it’s a belligerent approach and it’s unacceptable.

“If we remain silent, we remain weak. [If] we block our ears and pretend it’s going to go away, the problem will only just compound.”

Liberal backbench MP Dave Sharma, a former Australian ambassador to Israel, said the prospect of resumed dialogue between ministers was welcome, but Australians should not be “naive or delusional”.

“China might be changing its tactics but its ultimate goals and objectives I think have not shifted here,” he told Sky News.

Apple is overcoming the costly global shortage in computer chips, posting record sales over the Christmas holiday quarter, beating profit estimates and forecasting that its shortfall is narrowing.

The iPhone maker, the world’s largest company by market capitalisation, has handled supply-chain challenges such as factory shutdowns and shipping delays brought on by the pandemic better than any of its rivals, analysts said.

Apple shares rose about 5 per cent in after-hours trading on Thursday (Friday AEDT), erasing half their losses on the year.

More people wanted iPhones, iPads and other gadgets over the holiday quarter than Apple had to sell, costing the company over $US6 billion ($8.5 billion) in sales, in-line with what it feared.

Yet, Apple, which is the biggest customer of many parts suppliers, used its buying power to squeeze those vendors to ship enough gadgets to power record sales in its iPhones, Mac and wearables and accessories segments. Apple executives said chip shortages mostly affected older models of its products and particularly slowed iPad sales.

• Atlassian shares rose as much as 10% in late Nasdaq Trading on Thursday in the US on the release of the company’s second quarter results.
• The company posted second quarter revenue of $US688.5 million, up 37% on the same quarter last year.
• Atlassian co-CEOs said the jump is a new record that illustrates the company’s progress and commitment to “innovation in the cloud”.

Shares in Atlassian rose as much as 10% in late Nasdaq trading on Thursday in the US after the software-as-a-service giant delivered healthy second quarter results that came in ahead of even the most optimistic of analyst expectations. 

Atlassian shares rallied after the company posted second quarter revenue of $US688.5 million, up 37% on the same quarter last year, while total customers rose to 194,000, an increase of more than 11,600 users through the quarter. 

Atlassian co-founders and CEOs Scott Farquhar and Mike Cannon-Brookes said the jump is a new record that illustrates the company’s progress and commitment to “innovation in the cloud”. 

“Through the strength of our cloud platform, we’re delivering customers powerful new products like Jira Service Management, which unleashes the potential of technical teams in the ITSM market,” Cannon-Brookes said. 

“This is one example of the value we deliver to organisations large and small across the Fortune 500,000 to power their most mission-critical workflows,” he said. “We’re excited to continue that momentum in the second half of fiscal year 2021.”

At the close of the quarter, Atlassian’s operating income was $US27.7 million, with a 6% margin, down from the $US41.8 million for the second quarter of 2020. Net loss per diluted share came in at $US2.49 for the quarter, up on the $US0.49 tallied in the second quarter of 2020.

For the full fiscal year, Atlassian expects subscription revenue — which accounts for about 86% of the firm’s total revenue — will jump by about 50%, up from earlier forecasts that pegged the increase to sit in the mid-40s. 

In a letter to shareholders, Cannon-Brookes and Farquhar steered focus toward enterprise subscription growth, and the increasing uptake of its partner program and app marketplace. 

“Partners are critical to our long-term success. What’s more, they see Atlassian Cloud as being critical to their success and are embracing the new opportunities around migrations, sales, and app development it provides,” the co-CEOs wrote. 

“And the numbers bear this out: Cloud sales from our Channel Partners in Q2 were up 131% year-over-year.”

The pair say that customers add roughly 28,000 apps to their Atlassian products every week, and that adoption of the company’s cloud apps is tracking faster than adoption of the company’s actual cloud products. 

“Cloud apps now account for nearly 50% of Atlassian Marketplace listings overall, with over 70% of Jira and Confluence Cloud customers having at least one app installed,” they wrote. 

“Apps are tightly correlated with customer loyalty because of the additional value they help customers realise. We’ll continue to make the right moves to grow our offerings and invest in the success of our 1,250+ Marketplace Partners.”

As part of the earnings call, Atlassian announced that it had also moved to acquire the virtual agent start-up “Percept.ai” in a bid to bolster its “investments in automation and machine learning”.

“As part of Jira Service Management, Percept.ai’s virtual agent technology will automate day-to-day support interactions,” the co-CEOs said. 

“Its AI engine analyses intent, sentiment, and context to personalize interactions, and when necessary, seamlessly transitions conversations to human agents. With the robots taking the rote aspects of their job support staff can focus on process improvements and other forward-looking work.”

The Atlassian co-founders also took the opportunity to tout their approach to the future of work, with a recruitment call centred around the popularity of their newly-implemented “TEAM Anywhere” program, which has seen more than a quarter of the company’s Sydney-based workforce abandon the metropolis in favour of the regions. 

“We believe this has helped shield Atlassian from the massive employee attrition many other companies are experiencing,” Cannon-Brookes and Farquhar wrote. 

“It also means Atlassian is recruiting the most talented people to support our goals, even if they don’t turn up to an office every day. Over 40% of the new Atlassians hired in calendar 2021 live more than two hours away from the nearest Atlassian office,” they wrote. 

“That number will keep growing as we ramp up the pace of hiring over the next several quarters.”

Jobs marketplace Airtasker copped a whack in last year’s COVID-19 lockdowns, but has recovered its growth trajectory and reported an underlying lift in average price per task.

On Monday, the Sydney-based company reported gross marketplace volume jumped 39 per cent quarter-on-quarter to $48.6 million, translating to a 37.5 per cent jump in second-quarter revenue to $8.1 million.

While the mix of jobs on the platform was skewed heavily towards domestic tasks around the home, chief executive and founder Tim Fung said growth in the average price task had jumped about 24 per cent to $255 from the year-earlier period.

“Growth in wages for Australian workers is a really positive sign,” Mr Fung said.

“And because individuals are setting the prices with other individuals, it shows the difference between a platform like ours and ride-sharing or food delivery. This model is very adaptive and resilient to changes in the marketplace.”

Shares in Airtasker jumped over 12 per cent to 72¢ in late trade on Monday, trading marginally higher than its 65¢ listing price last in March.

A tough year with lockdowns in Sydney and Melbourne locally, and the UK and the US abroad, meant Airtasker was unable to meet its initial guidance.

During the first quarter, major cities were locked down for about 188 days, which slugged Airtasker with a $12 million impact on the company’s gross marketplace volume.

But in the second quarter, major cities were locked down for about 32 days, which only hit the company’s marketplace volume by around $2 million.

“We see a big depression in marketplace activity during lockdowns because a lot of the jobs are in-person jobs,” Mr Fung said.

“But as we’ve seen year to year, the bounce back to normal growth is quite strong and the lockdowns tend to have a very temporary impact.”

As such, the tech company has upgraded its outlook for the second half of the year, pointing to continued growth and a lift in marketing investment.

Guidance for gross marketplace volume has bumped up to between $107 million to $110 million, representing full-year volumes of $191 million to $194 million, and a lockdown-adjusted volume of $205 million to $208 million.

Before the 2021 lockdowns, Airtasker had expected to hit gross marketplace volumes of $200 million.

Last May, Airtasker raised $20.7 million from investors to buy US local services marketplace Zaarly for just $3.4 million, leaving it with a hefty amount of cash on the balance sheet.

Following the acquisition, Airtasker has focused on building its presence in Atlanta, Kansas City, Dallas and Miami. It reported a 71 per cent quarter-on-quarter growth in posted tasks in the US, a focus for the business as it moves through the “zero to one” stage of developing the new marketplaces.

“It’s really early days there, but we’re seeing it gaining some traction,” Mr Fung said.

Airtasker also has a presence in Britain and is seeing both sides of the marketplaces balancing out. In the second quarter, posted tasks in the UK rose 106 per cent, with engagement (people offering to complete tasks) climbing 102 per cent over the prior corresponding period.

Following a key marketing hire in Noelle Kim from Facebook last year, Airtasker will crank up its marketing spend in the next six months to increase its customer acquisition funnel.

Mr Fung said Airtasker spent about $1.6 million marketing in the year ended June 30 and plans to sharply increase that over the next half.

Australia may be forced into banning the popular Chinese social media application WeChat after Prime Minister Scott Morrison was blocked from accessing his account, cyber experts say.

WeChat’s owner, Tencent, on Monday night issued a statement saying it was investigating the apparent “hijacking” of Mr Morrison’s account.

“Based on our information, this appears to be a dispute over account ownership — the account in question was originally registered by a PRC [People’s Republic of China] individual and was subsequently transferred to its current operator, a technology services company — and it will be handled in accordance with our platform rules,” the company said in a statement.

“Tencent is committed to upholding the integrity of our platform and the security of all users accounts, and we will continue to look into this matter.”

Mr Morrison’s media team, like many other people and organisations based outside of China, used a Chinese agency to register the account.

The cyber squatters have effectively gained access to the 76,000 subscribers Mr Morrison had accrued and renamed the account “Australian Chinese new life”.

Amid tensions between Canberra and Beijing, Mr Morrison lost control of his account in July and his staff have tried fruitlessly, as recent as January 10, to regain control. The issue was first reported by Sydney’s Daily Telegraphnewspaper.

Mr Morrison had used the account to communicate in Mandarin directly to Chinese Australian voters, a crucial political constituency in several swing seats.

He most notably used it in 2020 to respond to China’s Foreign Ministry “slurring” of Australian troops over war crimes allegations, although Chinese censors blocked the message at that time.

Chair of Parliament’s intelligence committee, Senator James Paterson, said no Australian politician should be on WeChat if it censored the PM, including Opposition leader Anthony Albanese.

“So what the Chinese government has done by shutting down the Prime Minister’s account is effectively foreign interference in our democracy and in an election year,” Senator Paterson told 2GB.

Liberal MP Gladys Liu announced she would shut down her account in response.

Ms Liu said: “It is a matter of record that the platform has stopped the Prime Minister’s access, while Anthony Albanese’s account is still active featuring posts criticising the government.”

Mr Albanese said it was concerning Mr Morrison had lost control of his account and he was happy to discuss the matter with the PM and national security agencies, although stressed it should not be treated as a “political football”.

“If they were serious about it, then someone would have picked up the phone,” Mr Albanese said.

Internet 2.0 chief executive Robert Potter, a top cyber security expert, said no other politician had suffered a similar fate as Mr Morrison as having their account taken over, with Chinese tech giants simply banning voices they disagreed with.

He said if WeChat did not relent, he predicted Australia could ban the company and remove the app from the Google and Apple stores.

“It would be very straightforward for the government to make the distribution of WeChat in Australia impossible,” he said.

“If we can’t find a way to engage with Chinese controlled platforms without accepting their controls around censorship, we are probably heading for a break.”

Mr Potter said the “Australian Chinese new life” account had not posted original content and had simply reposted links back to Chinese news websites, making it simply a propaganda account.

He described WeChat’s owner TenCent as “incredibly sinister” and said the matter appeared state sanctioned given how strict China’s ruling Communist Party controlled tech companies.

“The Chinese government has greater control over media in Chinese than any institution has in the English language, be it the Murdoch press or public broadcasters,” he said.

• Tech stocks took a beating Wednesday, and the tech-heavy Nasdaq 100 has struggled to regain ground since then.
• Rising interest rates and expectations of strong economic growth and inflation are all key factors in the sell-off.
• Investors are looking for companies that can ride out 2022, and leaving speculative tech stocks behind.

Tech stocks have taken an almighty beating this week, with the Nasdaq 100 falling 3.12% Wednesday in its worst day since March.

The index slipped slightly Thursday, and futures are pointing lower Friday. Ark Invest’s Innovation ETF – seen by analysts as a proxy for unprofitable tech companies – has slumped 12% this year so far.

But why are tech stocks falling so hard? Is it rising bond yields, expectations for strong growth, hot inflation, or all of the above? We’ll try to explain.

Central banks juiced the market in 2020 and 2021

First, it’s important to understand why tech rocketed to begin with. When coronavirus hit in 2020, central banks slashed interest rates and pumped trillions of dollars into economies.

Bond yields cratered, so investors started looking elsewhere for returns. Banks, energy companies and the like were in the doldrums, so investors turned to the so-called stay-at-home stocks like Amazon, Apple and Google.

But borrowing was cheaper than ever. So, investors thought, why not take a bet on flashy – if unprofitable – tech companies that might be the next Netflix or Tesla?

Fast forward a year and almost all of those calculations have changed.

Bond yields are rising – and that’s bad news for tech

The Fed signaled last year that it’s going to raise interest rates in 2022, and has already started slowing bond purchases, as it tackles the strongest inflation since the 1980s.

But the trigger for Wednesday’s sell-off was the release of minutes from the last Fed meeting in December. They revealed officials are weighing up moving faster than previously expected, sending investors into a panic.

Rising interest rates – and the resulting higher bond yields – hurt tech stocks for a few reasons.

The key one is that many technology companies are currently unprofitable or make little money. If bond yields are higher, then investors are losing out on returns in the here and now by holding tech companies that will only start earning properly in the distant future. That makes those firms look a lot less appealing.

Higher interest rates are also good for the financial sector. Banks have fared particularly well over the last few months, drawing investors away from tech.

Growth is expected to stay strong

Another key factor at play is that investors expect the US and global economy to be strong in 2022.

US jobs data from private company ADP came in much stronger than expected Wednesday. On top of this, the Omicron coronavirus variant tearing across the US seems to be considerably milder than previous iterations.

The prospect of a strong economy is sending investors back to the very kinds of companies – airlines, restaurants, hotels – that they dumped during the worst of the pandemic in favor of stay-at-home and speculative tech stocks.

Inflation is also sticking around

Yet inflation is also red hot, and is expected to remain strong in 2022. Not only does that make it more likely that the Fed will raise rates, but it also sends buyers searching for companies that can ride out the storm.

Instead of flashy tech names, investors are snooping around for firms that can successfully raise their prices, such as luxury consumer brands. And they’re buying sectors that traditionally fare well during times of inflation, like real estate and energy.

But not all tech companies are equal. Analysts expect stocks such as Apple, Amazon and Google to fare much better in 2022 than unprofitable tech companies, because, simply put, they make tons of money.

Working for a new company educates employees on the overall uncertainty of a workforce in flux. 

During the ​2008 ​economic downturn, I quit an incredible job to become an online news media and digital publishing entrepreneur.

While I have worked with big enterprises in the past, it was only when I was exposed to the world of startups that is an excellent breeding ground for skills that I was able to survive recurring economic slowdowns. Here are four reasons why you should do the same...

New companies are ​b​etter at ​m​anaging ​u​ncertain​ty ​​

Unlike employees of large corporations that enjoy the stability of working for an established company, startup employees face chaos, ambiguity, doubts and contingencies more frequently than employees at a large organization. This leads to flexibility and ingenuity in decision-making. If you can predict better, you can control the outcome to adeptly survive the unknown, the unsure and the hard knocks that accompany times of ​adversity. 

Finding security in insecurity

Startups teach you how to live with stress and pressure and how to hustle or come up with creative or clever solutions. It teaches you to become bold, take risks, fail,  set your own directions and move fast. This will make you self-reliant, persistent, resilient, quick, nimble and execution-driven. It will serve as the most effective conduit to keep the reins of your life in your hands and provide a fertile ground for a first foray into entrepreneurship when you are forced to do so and can't find a job. 

Working closely with your company's leaders

I worked for a credit card and consumer finance consulting company that was founded by a veteran banker and worked closely with the owner, which gave me an in-depth understanding of what it takes to scale a business, enhance its brand equity and learn how to effectively manage prominent clients. 

The consulting company allowed me to pick up problem-solving techniques that I might not have been exposed to in a more segmented role at a larger company. I also learned how to manage a website, write a press release, article, report and above all, understand why caring provides a competitive advantage. This held me in good stead when I became an entrepreneur during the economic decline of 2007-09. 

Spawn innovation during tough times

Because startups have leaner hierarchies (your opinion matters) and you are expected to wear multiple hats that means the impact of your work is readily apparent than if you were in a big company. This instills​ ​a deep pride in your work​ and a credo, that ​if you​'​re truly imaginative you will overcome obstacles​. ​​​​

My father worked for a ​stable and ​reputed international bank for over three decades, which assured him job security and career advancement while expos​ing him to experts from different fields, sectors and geographies. ​Yet today it ​would be a fallacy to think that younger Boomers, ​Millennials and Gen Z will have the luxury of job security in a world undergoing momentous socio-economic, cultural, political, legal and environmental changes. 

Reignite your purpose and passion and transform your life for the better at a startup.